Should I Ditch this Life Insurance Policy?

Bariwhites

I don't even know why I am asking this question as I think I know the answer but any general advice would be appreciated.

When we bought our current house in 2002 I was advised to take out life insurance to cover the cost of the mortgage. As my wife wasn't working at the time the policy just covers my life. Its a level term assurance with critical illness and life cover and costs £25.50 a month which I have been paying since 2002.

The policy would pay out £44k should I die or be diagnosed with a critical illness.

I am not sure why the insurance value was set at £44k, as the mortgage was for more than that. Add onto this the additional borrowing for an extension and the current outstanding mortgage stands at £78k.

I am the main income earner and I have a generous death benefit/pension payment plan from my employer should I die. My wife is now working as a self employed beauty therapist and I want to try and get our life insurance in order. In particular a policy that covers us both.

Should I just simply ditch this policy and look for something else? If so, what type of policy should I be looking for?

Thanks in advance

dunstonh

Should I just simply ditch this policy and look for something else?

Depends on whether its cost efficient to keep it running or not compared to modern alternatives.

If so, what type of policy should I be looking for?

Depends on your circumstances. You have family income benefit, decreasing term assurance, level term assurances and whole of life plans as the main options nowadays (there are about 12 other types as well but i have listed the mainstream versions).

Joint may or may not be the best option. Sometimes 2-4 policies can be the best and most efficient option as spouses rarely have the same life cover needs and require different sum assureds. Plus mortgages would tend to be on one plan and family protection on another.